Operating Leases
The Company leases certain facilities and equipment under operating leases. Leases with a lease term of twelve months or less are considered short-term leases and are not recorded on the balance sheet, and expense for these leases is recognized over the term of the lease. All other leases have remaining terms of less than one year to five years, some of which may include options to extend the lease and some of which may include options to terminate the lease within one year. The Company uses judgment to determine whether it is reasonably possible to extend the lease beyond the initial term or terminate before the initial term ends and the length of the possible extension or early termination. The leases are renewable at the option of the Company and do not contain residual value guarantees, covenants, or other restrictions.
The components of lease costs were as follows:
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Operating lease costs | $ | 1,593 | | | $ | 2,379 | | | $ | 2,234 | |
| Short-term lease costs | 33 | | | 55 | | | 52 | |
| Variable lease costs | 390 | | | 368 | | | 384 | |
| Lease costs | $ | 2,016 | | | $ | 2,802 | | | $ | 2,670 | |
As of December 31, 2025, maturities of lease liabilities, excluding short-term and variable leases, for continuing operations were as follows:
| | | | | |
| 2026 | $ | 1,680 | |
| 2027 | 1,489 | |
| 2028 | 1,402 | |
| 2029 | 1,341 | |
| 2030 | 600 | |
| Thereafter | — | |
| Total | 6,512 | |
| Present value adjustment | (1,396) | |
| Total | $ | 5,116 | |
| Current portion of operating lease liabilities | $ | 1,136 | |
| Long-term portion of operating lease liabilities | 3,980 | |
| Total | $ | 5,116 | |
Other information related to operating leases in continuing operations was as follows:
| | | | | | | | | | | |
| December 31, |
| 2025 | | 2024 |
| Weighted average remaining lease term (years) | 4.05 | | 4.83 |
| Weighted average discount rate | 11.47 | % | | 11.57 | % |
| | | | | | | | | | | | | | | | | |
| Year Ended December 31, |
| 2025 | | 2024 | | 2023 |
| Supplemental disclosure of cash flow information | | | | | |
| Cash paid for operating lease liabilities | $ | 1,601 | | | $ | 2,662 | | | $ | 2,326 | |
| Operating lease right-of-use assets obtained in exchange for new lease liabilities (includes new leases or modifications of existing leases) | 724 | | | 572 | | | 399 | |
During the year ended December 31, 2024 the Company recorded an impairment charge related to right-of-use assets. See Note 8 for further discussion.
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.