PROG Holdings, Inc.PRG
PROG Holdings, Inc. Leases Disclosure
LEASES
Lessor Information
Refer to Note 1 to these consolidated financial statements for further information about the Company's revenue generating activities as a lessor. All of Progressive Leasing's customer agreements are considered operating leases, and the Company currently does not have any sales-type or direct financing leases.
Lessee Information
As a lessee, the Company leases management and information technology space for corporate functions under operating leases expiring at various times through 2028. To the extent that a leased property is vacated prior to the termination of the lease, the Company may sublease these spaces to third parties. The Company also leased space for its hub facilities and information technology equipment under operating leases. For all of its leases in which the Company is a lessee, the Company has elected to include both the lease and non-lease components as a single component and account for it as a lease. The Company did not have any obligations under finance leases for any of the periods presented within the consolidated financial statements.
Operating lease costs are recorded on a straight-line basis within operating expenses in the consolidated statements of earnings. The Company did not have any subleases in which it remained as the primary obligor during 2025 or 2024. The Company's total operating lease cost is comprised of the following:
Year Ended December 31, | |||||||||||
| (In Thousands) | 2025 | 2024 | |||||||||
| Operating Lease cost: | |||||||||||
Operating Lease cost classified within Operating Expenses1 | $ | 1,560 | $ | 1,873 | |||||||
| Total Operating Lease cost: | $ | 1,560 | $ | 1,873 | |||||||
1 Short-term and variable lease expenses were not significant during the years ended December 31, 2025 and 2024. Short-term lease expense is defined as leases with a lease term of greater than one month, but not greater than 12 months.
Additional information regarding the Company's leasing activities as a lessee is as follows:
Year Ended December 31, | |||||||||||
| (In Thousands) | 2025 | 2024 | |||||||||
| Cash Paid for amounts included in measurement of Lease Liabilities: | |||||||||||
| Operating Cash Flows for Operating Leases | $ | 4,455 | $ | 5,473 | |||||||
| Total Cash paid for amounts included in measurement of Lease Liabilities | 4,455 | 5,473 | |||||||||
| Right-of-Use Assets obtained in exchange for new Operating Lease Liabilities | 144 | 648 | |||||||||
Supplemental balance sheet information related to leases is as follows:
| December 31, | ||||||||||||||||||||
| (In Thousands) | Balance Sheet Classification | 2025 | 2024 | |||||||||||||||||
| Assets | ||||||||||||||||||||
Total Lease Assets1 | Operating Lease Right-of-Use Assets | $ | 2,740 | $ | 3,879 | |||||||||||||||
| Liabilities | ||||||||||||||||||||
| Total Lease Liabilities | Operating Lease Liabilities | $ | 7,263 | $ | 11,307 | |||||||||||||||
1 Operating lease right-of-use assets as of December 31, 2024 reflect impairment charges of $4.5 million that were recorded as part of the restructuring activities during 2024. For further details related to the restructuring activities, see Note 11. There were no impairments of lease assets in 2025.
Many of the Company's real estate leases contain renewal options for additional periods ranging from to three years. The Company currently does not have any real estate leases in which it considers the renewal options to be reasonably certain of exercise, as the Company's leases contain contractual renewal rental rates that are considered to be in line with market rental rates and there are not significant economic penalties or business disruptions incurred by not exercising any renewal options.
The Company uses its incremental borrowing rate as the discount rate for its leases, as the implicit rate in the lease is not readily determinable. Below is a summary of the weighted-average discount rate and weighted-average remaining lease term for the Company's operating leases:
| December 31, | |||||||||||||||||||||||
| 2025 | 2024 | ||||||||||||||||||||||
Weighted Average Discount Rate | Weighted Average Remaining Lease Term (in years) | Weighted Average Discount Rate | Weighted Average Remaining Lease Term (in years) | ||||||||||||||||||||
| Operating Leases | 4.2 | % | 1.54 | 4.0 | % | 2.38 | |||||||||||||||||
Under the short-term lease exception provided within ASC 842, the Company does not record a lease liability or right-of-use asset for any leases that have a lease term of 12 months or less at commencement. Below is a summary of undiscounted operating lease liabilities that have initial terms in excess of one year as of December 31, 2025. The table also includes a reconciliation of the future undiscounted cash flows to the present value of operating lease liabilities included in the consolidated balance sheets.
| (In Thousands) | Total | ||||
2026 | $ | 4,230 | |||
2027 | 3,000 | ||||
2028 | 213 | ||||
2029 | — | ||||
2030 | — | ||||
| Thereafter | — | ||||
| Total Undiscounted Cash Flows | 7,443 | ||||
| Less: Interest | (180) | ||||
| Present Value of Lease Liabilities | $ | 7,263 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 18, 2026 | Showing above |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 26, 2021 | |
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.