LEASES
Our operating leases primarily consist of our G1_Dallas solar module facility in Wilmer, Texas and our G2_Austin solar cell manufacturing facility in Rockdale, Texas. In Norway, we also lease office space for the administration of our Norwegian operations and related European assets and the CQP, which includes support facilities. We also lease other office spaces to support additional personnel in various jurisdictions. We have short-term leases for which we elected to apply the short-term lease exemption to leases with a term of twelve months or less, and accordingly, have not recognized a right-of-use asset or lease liability. We have no other leases that are presented as continuing operations.
During the year ended December 31, 2025, certain amounts related to our European businesses that had previously been classified as held for sale as of December 31, 2024 were reclassified to held and used as it was determined that certain assets were no longer available for immediate sale or would be disposed of by means other than a sale and thus no longer met the criteria for classification as held for sale. Refer to Note 1 - Summary of Significant Accounting Policies for further details.
Lease liabilities consisted of the following (in thousands):
| | | | | | | | | | | | | | |
| | December 31, |
| | | 2025 | | 2024 |
| Accrued liabilities and other (short-term) | | $ | 14,931 | | | $ | 11,244 | |
| Operating lease liability (long-term) | | 143,534 | | | 105,687 | |
| Total | | $ | 158,465 | | | $ | 116,931 | |
Lease expense consisted of the following (in thousands):
| | | | | | | | | | | | | | |
| | Years ended December 31, |
| | | 2025 | | 2024 |
| Operating lease cost | | $ | 4,249 | | | $ | 3,058 | |
| Variable lease cost | | — | | | — | |
| Short-term lease cost | | 422 | | | — | |
| Total lease cost | | $ | 4,671 | | | $ | 3,058 | |
The remaining minimum lease payments due on our long-term leases as of December 31, 2025 are as follows (in thousands):
| | | | | | | | |
| | | |
| 2026 | | $ | 15,500 | |
| 2027 | | 16,488 | |
| 2028 | | 15,870 | |
| 2029 | | 15,980 | |
| 2030 | | 16,508 | |
| Thereafter | | 185,772 | |
| Total undiscounted lease payments | | $ | 266,118 | |
| Less: Imputed interest | | (107,653) | |
| Present value of lease liabilities | | $ | 158,465 | |
Weighted-average remaining lease term and discount rate were as follows:
| | | | | | | | | | | | | | |
| | December 31, |
| | | 2025 | | 2024 |
| Weighted-average remaining lease term (in years) | | 14.7 | | 13.9 |
| Weighted-average discount rate | | 7.1 | % | | 7.0 | % |
Supplemental cash flow information related to leases was as follows (in thousands):
| | | | | | | | | | | | | | |
| | Year ended December 31, |
| | 2025 | | 2024 |
| | | | |
| Cash paid for amounts included in the measurement of lease liabilities | | $ | 14,141 | | | $ | 1,691 | |
| Non-cash additions to right-of-use assets obtained in exchange for lease liabilities | | 44,699 | | | 111,779 | |
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.