Revolve Group, Inc. Leases Disclosure
Note 5. Leases
We lease office, warehouse and retail space and equipment used in connection with our operations under various operating leases, some of which provide for rental payments on a graduated basis, rent holidays and other incentives. Operating leases with a term greater than one year are recorded on the consolidated balance sheets as right-of-use lease assets and lease liabilities at the commencement date. These balances are initially recorded at the present value of future minimum lease payments calculated using our incremental borrowing rate and expected lease term and adjusted for items such as initial direct costs paid or incentives received.
The following table includes the components of our lease expense recorded in fulfillment expenses and general and administrative expenses in the accompanying consolidated statements of income.
|
|
Year Ended December 31, |
|
|||||||||
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
|
|
(in thousands) |
|
|||||||||
Operating lease expense |
|
$ |
11,389 |
|
|
$ |
10,658 |
|
|
$ |
8,991 |
|
Short-term lease expense |
|
|
94 |
|
|
|
115 |
|
|
|
105 |
|
Variable lease expense |
|
|
1,630 |
|
|
|
1,301 |
|
|
|
876 |
|
Total |
|
$ |
13,113 |
|
|
$ |
12,074 |
|
|
$ |
9,972 |
|
The following table presents future minimum lease payments and the impact of discounting as of December 31, 2025.
|
|
December 31, 2025 |
|
|
|
|
(in thousands) |
|
|
2026 |
|
$ |
12,744 |
|
2027 |
|
|
11,212 |
|
2028 |
|
|
8,234 |
|
2029 |
|
|
1,970 |
|
2030 |
|
|
1,874 |
|
Thereafter |
|
|
1,814 |
|
Total minimum lease payments |
|
|
37,848 |
|
Less imputed interest |
|
|
(5,393 |
) |
Present value of lease liabilities |
|
$ |
32,455 |
|
The weighted-average remaining term for our leases as of December 31, 2025 and 2024 was 3.6 years and 4.4 years, respectively. The weighted-average discount rate for our leases as of December 31, 2025 and 2024 was 8.0% and 8.3%, respectively.
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.