Liberty Energy Inc.LBRT
Liberty Energy Inc. Leases Disclosure
Leases
Lessee Arrangements
The Company has operating and finance leases primarily for vehicles, equipment, railcars, office space, and facilities. The terms and conditions for these leases vary by the type of underlying asset.
Certain leases include variable lease payments for items such as property taxes, insurance, maintenance, and other operating expenses associated with leased assets. Payments that vary based on an index or rate are included in the measurement of lease assets and liabilities at the rate as of the commencement date. All other variable lease payments are excluded from the measurement of lease assets and liabilities, and are recognized in the period in which the obligation for those payments is incurred.
The components of lease expense for the years ended as of December 31, 2025, and 2024 were as follows:
| ($ in thousands) | 2025 | 2024 | ||||||||||||
| Finance lease cost: | ||||||||||||||
| Amortization of right-of-use assets | $ | 57,547 | $ | 43,364 | ||||||||||
| Interest on lease liabilities | 20,854 | 16,972 | ||||||||||||
| Operating lease cost | 36,434 | 35,861 | ||||||||||||
| Variable lease cost | 6,402 | 6,392 | ||||||||||||
| Short-term lease cost | 3,261 | 3,422 | ||||||||||||
| Total lease cost, net | $ | 124,498 | $ | 106,011 | ||||||||||
Supplemental cash flow and other information related to leases for the years ended December 31, 2025 and 2024 were as follows:
| ($ in thousands) | 2025 | 2024 | |||||||||
| Cash paid for amounts included in measurement of liabilities: | |||||||||||
| Operating leases | $ | 37,149 | $ | 35,653 | |||||||
| Finance leases | 101,720 | 67,181 | |||||||||
| Right-of-use assets obtained in exchange for new lease liabilities: | |||||||||||
| Operating leases | 28,850 | 14,581 | |||||||||
| Finance leases | 118,745 | 149,005 | |||||||||
During the year ended December 31, 2024, the Company amended certain operating leases, the change in terms of which caused the leases to be reclassified as finance leases. Additionally, the Company recognized finance lease right-of-use assets of $4.4 million and liabilities of $4.3 million. There was no gain or loss recognized as a result of these amendments. During the year ended December 31, 2025, the Company did not amend any operating or finance leases.
Lease terms and discount rates as of December 31, 2025 and 2024 were as follows:
| December 31, 2025 | December 31, 2024 | |||||||||||||
| Weighted-average remaining lease term: | ||||||||||||||
| Operating leases | 4.1 Years | 3.8 Years | ||||||||||||
| Finance leases | 2.9 Years | 3.2 Years | ||||||||||||
| Weighted-average discount rate: | ||||||||||||||
| Operating leases | 7.6 | % | 6.7 | % | ||||||||||
| Finance leases | 6.9 | % | 7.4 | % | ||||||||||
Future minimum lease commitments as of December 31, 2025 are as follows:
| ($ in thousands) | Finance | Operating | ||||||||||||
| 2026 | $ | 116,250 | $ | 25,547 | ||||||||||
| 2027 | 86,810 | 18,506 | ||||||||||||
| 2028 | 91,937 | 10,410 | ||||||||||||
| 2029 | 47,922 | 6,803 | ||||||||||||
| 2030 | 4,508 | 3,739 | ||||||||||||
| Thereafter | — | 8,472 | ||||||||||||
| Total lease payments | 347,427 | 73,477 | ||||||||||||
| Less imputed interest | 39,929 | 9,296 | ||||||||||||
| Total | $ | 307,498 | $ | 64,181 | ||||||||||
The Company’s vehicle leases typically include a residual value guarantee. For the Company’s vehicle leases classified as operating leases, the total residual value guaranteed as of December 31, 2025 is $12.5 million; the payment is not probable and therefore has not been included in the measurement of the lease liability and right-of-use asset. For vehicle leases that are
classified as finance leases, the Company includes the residual value guarantee, estimated in the lease agreement, in the financing lease liability.
Lessor Arrangements
The Company leases dry and wet sand containers, conveyor belts, and other equipment to customers through operating leases, where the lessor for tax purposes is considered to be the owner of the equipment during the term of the lease. The lease agreements do not include options for the lessee to purchase the underlying asset at the end of the lease term for either a stated fixed price or fair market value. However, some of the leases contain a termination clause in which the customer can cancel the contract. The leases can be subject to variable lease payments if the customer requests more units than what is agreed upon in the lease. The Company does not record any lease assets or liabilities related to these variable items.
The carrying amount of equipment leased to others, included in property, plant and equipment, under operating leases as of December 31, 2025 and 2024 were as follows:
| ($ in thousands) | December 31, 2025 | December 31, 2024 | ||||||||||||
| Equipment leased to others - at original cost | $ | 158,716 | $ | 163,889 | ||||||||||
| Less: Accumulated depreciation | (59,299) | (41,223) | ||||||||||||
| Equipment leased to others - net | $ | 99,417 | $ | 122,666 | ||||||||||
Future payments receivable for operating leases as of December 31, 2025 are as follows:
| ($ in thousands) | ||||||||
| 2026 | $ | 1,919 | ||||||
| 2027 | — | |||||||
| 2028 | — | |||||||
| 2029 | — | |||||||
| 2030 | — | |||||||
| Thereafter | — | |||||||
| Total | $ | 1,919 | ||||||
Revenues from for the years ended December 31, 2025 and 2024 were $46.1 million and $39.0 million, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 2, 2026 | Showing above |
| 2024 | Feb 6, 2025 | |
| 2023 | Feb 9, 2024 | |
| 2022 | Feb 10, 2023 | |
| 2021 | Feb 22, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 27, 2020 | |
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.