Leases
Components of lease expense were as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | |
| | 2026 | | 2025 | | 2024 |
| Operating lease expense | | $ | 37,629 | | | $ | 34,469 | | | $ | 30,305 | |
| Variable and short term lease expense | | 5,877 | | | 7,465 | | | 13,290 | |
| Total lease expense | | $ | 43,506 | | | $ | 41,934 | | | $ | 43,595 | |
Variable lease expense includes percentage rent, maintenance, real estate taxes, insurance and other variable charges included in the lease as well as rental expenses related to short term leases.
During fiscal 2026, 2025, and 2024, we did not recognize any impairment charges associated with showroom-level right-of-use assets.
Future minimum lease payments under non-cancelable leases as of February 1, 2026 were as follows (in thousands):
| | | | | | | | |
| | |
| 2027 | | $ | 35,232 | |
| 2028 | | 36,770 | |
| 2029 | | 33,588 | |
| 2030 | | 31,690 | |
| 2031 | | 26,436 | |
| Thereafter | | 74,481 | |
| Total undiscounted future minimum lease payments | | 238,197 | |
| Less: imputed interest | | (45,686) | |
| Total present value of lease obligations | | 192,511 | |
| Less: current operating lease liability | | (24,111) | |
| Operating lease liability- long term | | $ | 168,400 | |
Supplemental cash flow information related to our operating leases is as follows (in thousands):
| | | | | | | | | | | | | | | | | | | | |
| | 2026 | | 2025 | | 2024 |
| Operating cash flow information: | | | | | | |
| Amounts paid on operating lease liabilities | | $ | 39,043 | | $ | 34,651 | | $ | 29,748 |
| Non-cash activities: | | | | | | |
| Right-of-use assets obtained in exchange for lease obligations | | $ | 28,840 | | $ | 22,639 | | $ | 42,064 |
| Weighted average remaining lease term - operating leases | | 6.9 years | | 6.9 years | | 7.5 years |
| Weighted average discount rate - operating leases | | 5.59% | | 5.23% | | 4.97% |
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.