Our operating leases consist of real estate and vehicles and have remaining lease terms of one year to 12 years. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend the lease when it is reasonably certain that we will exercise those options. Our operating lease arrangements do not contain any material restrictive covenants or residual value guarantees.
Lease costs are presented below (in thousands):
| | | | | | | | | | | | | | | | | |
| Year Ended January 31, |
| 2026 | | 2025 | | 2024 |
| Operating lease cost | $ | 16,976 | | | $ | 15,899 | | | $ | 13,047 | |
| Short-term lease cost | 2,709 | | | 3,722 | | | 4,965 | |
| Variable lease cost | 3,479 | | | 2,065 | | | 2,142 | |
Sublease income(1) | — | | | — | | | (1,615) | |
| Total lease cost | $ | 23,164 | | | $ | 21,686 | | | $ | 18,539 | |
(1) Included in other income, net in the consolidated statements of operations |
Supplemental balance sheet information related to leases is as follows (in thousands):
| | | | | | | | | | | |
| As of January 31, |
| 2026 | | 2025 |
| Assets: | | | |
| Operating lease right-of-use assets | $ | 64,472 | | | $ | 66,500 | |
| Liabilities: | | | |
| Operating lease liabilities, current (included in accrued expenses and other current liabilities) | $ | 10,306 | | | $ | 3,587 | |
| Operating lease liabilities, non-current | 70,940 | | | 74,230 | |
| Total operating lease liabilities | $ | 81,246 | | | $ | 77,817 | |
Supplemental cash flow information related to operating leases is as follows for the periods presented (in thousands):
| | | | | | | | | | | | | | | | | |
| Year Ended January 31, |
| 2026 | | 2025 | | 2024 |
| Cash paid for amounts included in the measurement of operating lease liabilities | $ | 16,745 | | | $ | 16,758 | | | $ | 12,907 | |
| Operating lease ROU assets obtained in exchange for new operating lease liabilities | $ | 5,712 | | | $ | 21,242 | | | $ | 12,986 | |
The following table represents the weighted-average remaining lease term and discount rate for the periods presented:
| | | | | | | | | | | |
| As of January 31, |
| 2026 | | 2025 |
| Weighted-average remaining lease term (years) | 9.1 | | 10.1 |
| Weighted-average discount rate | 7.2 | % | | 7.2 | % |
Future undiscounted lease payments for our operating lease liabilities as of January 31, 2026 were as follows (in thousands):
| | | | | |
Year Ended January 31, | Amount |
| 2027 | $ | 15,940 | |
| 2028 | 15,194 | |
| 2029 | 11,372 | |
| 2030 | 10,069 | |
| 2031 | 9,541 | |
| Thereafter | 48,280 | |
| Total operating lease payments | 110,396 | |
| Less: imputed interest | (29,150) | |
| Total operating lease liabilities | $ | 81,246 | |
As of January 31, 2026, we had non-cancellable commitments in the amount of $12.2 million related to operating leases of real estate facilities that have not yet commenced.
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.