9. Leases

The Company maintains operating and finance leases that grant us the right to use compression equipment, office spaces and certain corporate equipment. The Company’s leases have remaining lease terms of up to 15 years, some of which include options that permit renewals for additional periods. We are not, however, reasonably certain to exercise any

renewal options and accordingly have not included those renewal periods in the remaining lease terms. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Leases are presented in our consolidated balance sheet as follows:


		As of December 31,
(in thousands)	Classification	2025		2024
Right-of-use Assets:
Operating leases	Operating lease right-of-use assets, net	$	42,218	$	53,754
Finance leases	Finance lease right-of-use assets, net	$	6,500	$	5,696

Lease liabilities:
Operating lease liabilities:
Current	Accrued liabilities	$	9,796	$	9,930
Noncurrent	Operating lease liabilities	39,391		49,748
Total operating lease liabilities		$	49,187	$	59,678

Finance lease liabilities:
Current	Accrued liabilities	$	2,224	$	1,928
Noncurrent	Finance lease liabilities	4,405		3,514
Total finance lease liabilities		$	6,629	$	5,442

The components of total lease cost were as follows:


	For the Year Ended December 31,
(in thousands)	2025		2024		2023
Operating lease expense:
Operating lease expense	$	15,828	$	14,993	$	6,536
Short-term lease expense	5,377		4,287		1,132
Total operating lease expense	21,205		19,280		7,668

Finance lease expense:
Amortization of leased assets	2,640		1,421		—
Interest on lease liabilities	546		202		—
Total finance lease expense	3,185		1,623		—
Total lease expense	$	24,390	$	20,903	$	7,668

The short-term lease cost disclosed above reasonably reflects the Company’s ongoing short-term lease commitments. These lease costs are primarily recorded within cost of operations.

Supplemental information related to the Company’s operating and finance leases were as follows:


	For the Year Ended December 31,
(in thousands, except years and percentages)	2025			2024			2023
Other supplemental information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	26,600		$	16,879		$	5,800
Operating cash flows - finance leases	517			319			—

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	7,294		$	12,894		$	28,353
Finance leases	3,418			7,111			—

Weighted-average remaining lease term:
Operating leases	5.64 years			6.56 years			7.50 years
Finance leases	2.97 years			3.07 years			—

Weighted-average discount rate:
Operating leases	9.2		%	9.5		%	9.5		%
Finance leases	6.4		%	6.1		%	—		%

Future minimum lease payments, under non-cancelable operating and finance leases with terms in excess of one year, as of December 31, 2025 are as follows:


(in thousands)	Operating leases		Finance leases
Year ended December 31,
2026	$	13,726	$	2,589
2027	11,023		2,553
2028	8,687		1,405
2029	8,203		773
2030	5,444		—
Thereafter	20,233		—
Total lease payments	67,316		7,320
Less: imputed interest	(18,129)		(691)
Total lease liabilities	$	49,187	$	6,629

As of December 31, 2025, we entered into two additional operating leases that has not yet commenced for building and land with lease obligations of $47.4 million. The operating leases will commence starting in 2026 with a lease term of approximately 15.1 and 20.1 years.

Historical Timeline

Fiscal Year	Filed
2025	Feb 26, 2026	Showing above
2024	Mar 7, 2025

2023	Mar 7, 2024

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.

Kodiak Gas Services, Inc. Leases Disclosure

Historical Timeline

About Leases Disclosures

Other Available Disclosures