Intuitive Machines, Inc.LUNR
Intuitive Machines, Inc. Leases Disclosure
NOTE 7 - LEASES
The Company leases real estate for administrative office space, research, marketing and light manufacturing operations of the lessee’s aerospace related research and development business under operating leases.
The Company has seven real estate leases with lease terms ranging from 30 months to 313 months and seven equipment leases (of which six are finance leases) with lease terms ranging from 36 months to 60 months, some of which contain options to extend and some of which contain options to terminate the lease without cause at the option of lessee.
The Company’s real estate leasing agreements include terms requiring the Company to reimburse the lessor for its share of real estate taxes, insurance, operating costs and utilities which the Company accounts for as variable lease costs when incurred since the Company has elected to not separate lease and non-lease components, and hence are not included in the measurement of lease liability. There are no restrictions or covenants imposed by any of the leases, and none of the Company’s leases contain material residual value guarantees.
Lunar Production and Operations Center Expansion
In July 2025, we executed an amendment to our ground lease agreement to expand our Lunar Production and Operations Center (“LPOC”) at the Houston Spaceport at Ellington Airport. The expansion calls for an additional investment of approximately $12.6 million by the Company for the construction of new production and testing facilities, plus support infrastructure, to scale our lunar lander assembly, Earth-reentry systems, Lunar Terrain Vehicle development, and NASA’s Near Space Network services. The amendment expands the total leased project site by an additional tract of approximately 3.0 acres. The amendment extends the lease term from 20 years to 25 years (ending October, 2048), with three optional renewal periods of 5 years each, and reduces the right-of-use assets and liabilities by approximately $7.1 million. The Company accounted for this amendment as a lease modification by remeasuring the right-of-use assets and liabilities as of
the effective date. Should construction costs exceed the estimated expansion investment, the Company will consider and account for the excess as variable lease payments or, if the excess costs are significant, the Company will remeasure the lease liability and right-of-use asset. Furthermore, the amendment includes lease components that have not yet commenced. The Company expects to recognize additional lease liabilities of approximately $7.9 million as the expansion phases are completed in 2026.
Spaceport Facility Lease Agreement
In July 2025, we executed a sublease for additional office and production space at the Houston Spaceport at Ellington Airport totaling approximately 116,000 square feet. The leased production space includes turn-key production equipment, including test facilities, that allow for an efficient and cost-effective expansion of our manufacturing capabilities. The lease agreement has a remaining term of 7 years. As of December 31, 2025, the Company recorded operating right-of-use assets of $6.4 million and operating lease liabilities of $6.8 million.
The components of total lease expense are as follows (in thousands):
| Year Ended December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Operating lease cost | $ | 5,025 | $ | 4,144 | |||||||
| Finance lease cost | 40 | 37 | |||||||||
| Variable lease cost | 431 | — | |||||||||
| Short-term lease cost | 580 | 94 | |||||||||
| Total lease cost | $ | 6,076 | $ | 4,275 | |||||||
The components of supplemental cash flow information are as follows (in thousands):
| Year Ended December 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
| Operating Leases | Finance Leases | Operating Leases | Finance Leases | ||||||||||||||||||||
| Cash paid for amounts included in the measurement of lease liabilities: | |||||||||||||||||||||||
| Cash flows from operating activities | $ | 3,379 | $ | 7 | $ | 2,019 | $ | 9 | |||||||||||||||
| Cash flows from investing activities | $ | — | $ | — | $ | 3,823 | $ | 2 | |||||||||||||||
| Cash flows from financing activities | $ | — | $ | 31 | $ | — | $ | 35 | |||||||||||||||
| Right-of-use assets obtained in exchange for new operating lease liabilities | $ | 7,182 | $ | — | $ | 4,145 | $ | 43 | |||||||||||||||
| Weighted average remaining lease term - operating leases (in months) | 211 | 23 | 204 | 28 | |||||||||||||||||||
| Weighted average discount rate - operating leases | 11.2 | % | 8.0 | % | 6.5 | % | 7.8 | % | |||||||||||||||
The operating and finance lease ROU assets, current operating lease liabilities, current finance lease liabilities, non-current operating lease liabilities, and non-current finance lease liabilities are disclosed in our consolidated balance sheets.
The table below includes the estimated future undiscounted cash flows for operating and finance leases as of December 31, 2025 (in thousands):
| Year Ending December 31, | Operating Leases | Finance Leases | ||||||||||||
| 2026 | $ | 12,597 | $ | 45 | ||||||||||
| 2027 | 6,691 | 21 | ||||||||||||
| 2028 | 3,603 | 7 | ||||||||||||
| 2029 | 3,920 | — | ||||||||||||
| 2030 | 3,940 | — | ||||||||||||
| Thereafter | 60,897 | — | ||||||||||||
| Total undiscounted lease payments | $ | 91,648 | $ | 73 | ||||||||||
| Less: imputed interest | 54,892 | 5 | ||||||||||||
| Present value of lease liabilities | $ | 36,756 | $ | 68 | ||||||||||
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 19, 2026 | Showing above |
| 2024 | Mar 25, 2025 | |
| 2023 | Mar 25, 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.