Leases
The following table presents components of lease expense:
| | | | | | | | | | | | | | | | | | | | |
| | | | Years Ended December 31, |
| | | | 2025 | | 2024 | | 2023 |
| Operating lease cost | | | | $ | 7,933 | | | $ | 7,995 | | | $ | 8,077 | |
| Finance lease cost: | | | | | | | | |
| Amortization of right-of-use assets | | | | 2,605 | | | 1,596 | | | 1,600 | |
| Interest expense | | | | 511 | | | 359 | | | 345 | |
| Short-term lease cost (1) | | | | 473 | | | 477 | | | 604 | |
| | | | | | | | |
| Sublease income | | | | (3,893) | | | (3,845) | | | (2,284) | |
| Total lease cost | | | | $ | 7,629 | | | $ | 6,582 | | | $ | 8,342 | |
_______________________________
(1) Excludes expenses related to leases with a lease term of one month or less.
The following table presents lease-related assets and liabilities recorded on the balance sheet.
| | | | | | | | | | | | | | | | | | | | |
| | | | As of December 31, |
| | Financial Statement Line Item | | 2025 | | 2024 |
| Assets: | | | | | | |
| Operating lease assets | | Operating lease right-of-use assets | | $ | 35,155 | | | $ | 39,317 | |
| Finance lease assets | | Property, plant and equipment, net | | 18,108 | | | 16,579 | |
| Total lease assets | | | | $ | 53,263 | | | $ | 55,896 | |
| | | | | | |
| Liabilities: | | | | | | |
| Current liabilities: | | | | | | |
| Operating lease liabilities | | Current portion of operating lease liabilities | | $ | 6,430 | | | $ | 6,038 | |
| Finance lease liabilities | | Other current liabilities | | 4,163 | | | 3,565 | |
| Non-current liabilities: | | | | | | |
| Operating lease liabilities | | Operating lease liabilities, net of current portion | | 37,092 | | | 42,291 | |
| Finance lease liabilities | | Other non-current liabilities | | 4,110 | | | 5,469 | |
| Total lease liabilities | | | | $ | 51,795 | | | $ | 57,363 | |
The following table contains supplemental cash flow information related to leases.
| | | | | | | | | | | | | | | | | |
| Years Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | |
| Operating cash flows used in operating leases | $ | 8,619 | | | $ | 8,511 | | | $ | 8,462 | |
| Operating cash flows used in finance leases | 511 | | | 359 | | | 345 | |
| Financing cash flows used in finance leases | 4,032 | | | 2,400 | | | 1,766 | |
| Right-of-use assets obtained in exchange for new operating lease liabilities (1) | — | | | 692 | | | 1,028 | |
| Right-of-use assets obtained in exchange for new finance lease liabilities | 2,689 | | | 5,170 | | | 1,619 | |
_______________________________
(1) Includes new leases, renewals, and modifications.
The weighted average remaining lease term and weighted-average discount rate for operating and finance leases were as follows:
| | | | | | | | | | | |
| As of December 31, |
| 2025 | | 2024 |
| Weighted-average remaining lease term - operating leases | 7.9 years | | 8.5 years |
| Weighted-average remaining lease term - finance leases | 2.2 years | | 2.6 years |
| Weighted-average discount rate - operating leases | 7.6 | % | | 7.7 | % |
| Weighted-average discount rate - finance leases | 5.8 | % | | 5.8 | % |
The maturities of lease liabilities as of December 31, 2025, is as follows:
| | | | | | | | | | | |
| Operating Leases | | Finance Leases |
| 2026 | $ | 8,531 | | | $ | 4,529 | |
| 2027 | 8,334 | | | 3,177 | |
| 2028 | 6,789 | | | 744 | |
| 2029 | 6,926 | | | 253 | |
| 2030 | 4,839 | | | 116 | |
| Thereafter | 20,441 | | | — | |
| Total future minimum lease payments | 55,860 | | | 8,819 | |
| Less: imputed interest | 12,338 | | | 546 | |
| Total lease liabilities | $ | 43,522 | | | $ | 8,273 | |
Subleases
We have entered into subleases for certain leased buildings or portions of leased buildings when no longer needed for our current operational needs. The weighted-average remaining lease term of our subleases is 8.8 years. In June 2023, we began subleasing our Taunton and Irvine sites, under subleases that extend through the lease termination dates of the respective head leases. We are subleasing a portion of our leased corporate headquarters office space under two separate subleases that expire in 2027 and 2029, respectively. The undiscounted cash flows to be received under operating subleases subsequent to December 31, 2025, is as follows:
| | | | | |
| 2026 | $ | 3,937 | |
| 2027 | 3,920 | |
| 2028 | 3,626 | |
| 2029 | 3,374 | |
| 2030 | 3,450 | |
| Thereafter | 15,812 | |
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.