Property and equipment was as follows as of December 31, 2025 and 2024 (in thousands):
| | | | | | | | | | | |
| December 31, 2025 | | December 31, 2024 |
| Infusion pumps | $ | 36,497 | | | $ | 37,659 | |
| Equipment, furniture and other | 28,087 | | | 24,055 | |
| Leasehold improvements | 126,651 | | | 116,675 | |
| Computer software, purchased and internally developed | 58,608 | | | 46,532 | |
| Assets under development | 19,207 | | | 22,990 | |
| 269,050 | | | 247,911 | |
| Less: accumulated depreciation | (129,814) | | | (120,544) | |
| Property and equipment, net | $ | 139,236 | | | $ | 127,367 | |
The following table presents the amount of depreciation expense recorded in cost of revenue and operating expenses for the years ended December 31, 2025, 2024, and 2023 (in thousands):
| | | | | | | | | | | | | | | | | |
| Year ended December 31, |
| 2025 | | 2024 | | 2023 |
| Depreciation expense in cost of revenue | $ | 3,152 | | | $ | 2,590 | | | $ | 2,999 | |
| Depreciation expense in operating expenses | 30,606 | | | 26,503 | | | 24,820 | |
| Total depreciation expense | $ | 33,758 | | | $ | 29,093 | | | $ | 27,819 | |
About PP&E Disclosures
The PP&E disclosure details a company's physical asset base — land, buildings, machinery, and equipment — along with the depreciation methods and useful life assumptions that determine how these costs flow through the income statement. Capitalization policy thresholds reveal management's judgment on the boundary between expense and asset, directly affecting both reported earnings and asset values.
Key signals: changes in estimated useful lives or depreciation methods can materially shift reported earnings without any operational change. Compare capital expenditures against depreciation expense — when capex consistently trails depreciation, the asset base may be aging and underinvested. Watch for large asset impairments or write-downs that signal overvalued carrying amounts. Asset retirement obligations reveal future environmental or decommissioning costs that are often underappreciated. Compare PP&E intensity (PP&E-to-revenue) against industry peers to assess capital efficiency and competitive positioning.