Leased Assets and Liabilities
We lease real estate, equipment and vehicles under operating and finance lease agreements. Our leases have terms of up to 10 years, and may include renewal options. At lease commencement, a lease liability and corresponding right-of-use asset is recognized. Lease liabilities represent the present value of future lease payments over the expected lease term, including options to extend or terminate the lease when it is reasonably certain those options will be exercised. Lease payments include all fixed payments and variable payments tied to an index, but exclude costs such as common area maintenance charges, property taxes, insurance and mileage. The present value of the lease liability is determined using our incremental borrowing rate at lease commencement. Information regarding operating and financing leases is as follows:
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| Leases | | Balance Sheet Location | | December 31, 2025 | | December 31, 2024 |
| Assets | | | | | | |
| Operating | | Operating lease assets | | $ | 106,996 | | | $ | 113,357 | |
| Finance | | Property, plant and equipment, net | | 35,490 | | | 31,271 | |
| Total leased assets | | | | $ | 142,486 | | | $ | 144,628 | |
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| Liabilities | | | | | | |
| Operating | | Current operating lease liabilities | | $ | 28,396 | | | $ | 26,912 | |
| | Noncurrent operating lease liabilities | | 99,757 | | | 100,804 | |
| Finance | | Accounts payable and accrued liabilities | | 10,585 | | | 8,938 | |
| | Other noncurrent liabilities | | 26,356 | | | 23,655 | |
| Total lease liabilities | | | | $ | 165,094 | | | $ | 160,309 | |
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| Years Ended December 31, |
| Lease Cost | 2025 | | 2024 | | 2023 |
| Operating lease expense | $ | 42,457 | | | $ | 37,640 | | | $ | 46,316 | |
| Finance lease expense | | | | | |
| Amortization of leased assets | 9,702 | | | 8,709 | | | 6,554 | |
| Interest on lease liabilities | 2,525 | | | 1,970 | | | 1,750 | |
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| Variable lease expense | 5,589 | | | 8,888 | | | 8,337 | |
| Sublease income | (433) | | | (335) | | | (466) | |
| Total expense | $ | 59,840 | | | $ | 56,872 | | | $ | 62,491 | |
Operating lease expense includes immaterial amounts related to leases with terms of 12 months or less.
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| Future Lease Payments | Operating Leases | | Finance Leases | | Total |
| 2026 | $ | 37,976 | | | $ | 12,707 | | | $ | 50,683 | |
| 2027 | 34,807 | | | 10,399 | | | 45,206 | |
| 2028 | 29,980 | | | 8,778 | | | 38,758 | |
| 2029 | 22,964 | | | 4,618 | | | 27,582 | |
| 2030 | 15,307 | | | 2,875 | | | 18,182 | |
| Thereafter | 11,678 | | | 2,949 | | | 14,627 | |
| Total | 152,712 | | | 42,326 | | | 195,038 | |
| Less: present value discount | 24,559 | | | 5,385 | | | 29,944 | |
| Lease liability | $ | 128,153 | | | $ | 36,941 | | | $ | 165,094 | |
Future lease payments exclude $5 million of payments for leases signed but not yet commenced at December 31, 2025.
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| Lease Term and Discount Rate | December 31, 2025 | | December 31, 2024 |
| Weighted-average remaining lease term | | | |
| Operating leases | 4.3 years | | 5.1 years |
| Finance leases | 4.1 years | | 3.9 years |
| Weighted-average discount rate | | | |
| Operating leases | 8.2% | | 9.3% |
| Finance leases | 7.2% | | 8.6% |
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| Years Ended December 31, |
| Cash Flow Information | 2025 | | 2024 | | 2023 |
| Operating cash outflows - operating leases | $ | 37,583 | | | $ | 40,775 | | | $ | 40,597 | |
| Operating cash outflows - finance leases | $ | 2,525 | | | $ | 1,970 | | | $ | 1,750 | |
| Financing cash outflows - finance leases | $ | 9,172 | | | $ | 5,310 | | | $ | 5,442 | |
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| Leased assets obtained in exchange for new lease obligations | | | | | |
| Operating leases | $ | 25,590 | | | $ | 11,765 | | | $ | 37,204 | |
| Finance leases | $ | 12,493 | | | $ | 12,433 | | | $ | 5,509 | |
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.