LiveOne, Inc. Leases Disclosure
Note 11 — Leases
On December 22, 2020, the Company acquired CPS which included the assumption of an operating lease for a 55,120 square foot light manufacturing facility located in Addison Illinois, which expired June 30, 2024. During the year ended March 31, 2025, CPS entered into a three year lease for office space in Palatine, Illinois.
The Company leases office locations with lease terms that are less than 12 months or are on month to month terms. Rent expense is recognized over the term of the lease on a straight-line basis. Rent expense for these leases totaled $0.5 million and $0.5 million for the year ended March 31, 2025 and 2024, respectively. Operating leases with lease terms of greater than 12 months are capitalized in Operating lease right-of-use assets and Operating lease liabilities in the consolidated balance sheet. Rent expense for these operating leases totaled $0.4 million and $0.4 million the years ended March 31, 2025 and 2024, respectively, which is included in general and administrative expenses in the consolidated statement of operations.
Operating lease costs for the years ended March 31, 2025 and 2024 consisted of the following (in thousands):
| Year Ended March 31, | ||||||||
| 2025 | 2024 | |||||||
| Fixed rent cost | $ | 456 | $ | 324 | ||||
| Short term lease cost | 88 | 596 | ||||||
| Total operating lease cost | $ | 544 | $ | 920 | ||||
Supplemental balance sheet information related to leases was as follows (in thousands):
| March 31, | March 31, | |||||||
| Operating leases | 2025 | 2024 | ||||||
|
| $ | 97 | $ | 88 | ||||
|
| $ | - | $ | 91 | ||||
|
| 99 | - | ||||||
| Total operating lease liabilities | $ | 99 | $ | 91 | ||||
The operating lease right-of-use assets are included in other assets in the March 31, 2025 and 2024 consolidated balance sheets, and operating lease liabilities are included in accounts payable and accrued liabilities and lease liabilities non-current in the March 31, 2025 and 2024 consolidated balance sheets.
Future maturities of operating lease liabilities as of March 31, 2025 were as follows (in thousands):
| For Years Ending March 31, | ||||
| 2026 | $ | 38 | ||
| 2027 | $ | 37 | ||
| 2028 | $ | 37 | ||
| Total lease payments | 112 | |||
| Less: imputed interest | (13 | ) | ||
| Present value of operating lease liabilities | $ | 99 |
Significant determinations
Discount rate – the Company’s lease is discounted using the Company’s incremental borrowing rate of 8.5% as the rate implicit in the lease is not readily determinable.
Options – the lease term is the minimum noncancelable period of the lease. The Company does not include option periods unless the Company determined it is reasonably certain of exercising the option at inception or when a triggering event occurs.
Lease and non-lease components – Non lease components were considered and determined not to be material.
PodcastOne arrangement
PodcastOne leases certain premises under a month-to-month operating lease. Rent expense for the operating lease totaled $0.3 million and $0.3 million for the year ended March 31, 2025 and March 31, 2024, respectively.
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.